MNI DATA ANALYSIS: Sep Borrowing Down; YTD Down Sharply>

-UK Sep borrowing Stg4.123bn vs Stg4.958bn Sep 2017

-UK April-Sep borrowing -35.0% over 2017 to Stg19.9 billion

-UK Corporate Tax receipts up Stg300m YTD, smallest rise in 5 years

By Laurie Laird and Jamie Satchithanantham

     London (MNI) - UK public borrowing declined in September, and 

downward revisions to previous months leave the Treasury with a 

higher-than-expected fiscal buffer ahead of a crucial budget statement 

at month end. 

     September borrowing, excluding the Bank of England, declined 

modestly to Stg4.123 billion, compared to the MNI median forecast of 

Stg4.5 billion, the lowest for the month of September since 2007, 

compared to Stg4.958 billion on year earlier. 

     Net debt fell to 75.3% of gross domestic product in September, 

matching the February outturn, down from 79.5% in the same month of 

2017. 

     Income tax receipts accounted for much of the reduction in 

September borrowing, with PAYE revenue rising by Stg700 million last 

month, according to a National Statistics official. 

     However, corporate tax receipts continued to disappoint, falling by 

Stg100 million to Stg5.0 billion last month. Over the fiscal year, 

corporate tax receipts have increased by just Stg300 million, the 

smallest increased since the 2013/14 fiscal year. 

     Borrowing remained well below year-ago levels over the first half 

of the fiscal year, recording an annual decline of 35.0% over 2017 to 

Stg19.9 billion, the lowest since the 2002/03 fiscal year. Downward 

revisions to previous months flattered the government's borrowing 

position, which was down by just 30.5% in August. 

     The public sector finances remain on track to meet the Office of 

Budget Responsibility forecast of Stg37.1 billion for the fiscal year, a 

7.1% decline on 2017/18. 

     However, borrowing was down by as much as 40% as recently as July, 

and the slight deterioration in recent months creates a dilemma for the 

Chancellor of the Exchequer ahead of the October 29 budget presentation. 

     Philip Hammond is under pressure to relax government austerity, 

even as uncertainty over the outcome of negotiations to leave the 

European Union raises large questions over the government's financial 

position after Brexit day on March 29, 2019. 

     The central government net cash requirement fell to Stg14.526 

billion in September, from Stg19.171 billion a year earlier.  

     The current budget deficit fell to Stg1.079 billion last month, 

from Stg2.018 billion a year earlier.   

     Including the Bank of England, public sector borrowing fell to 

Stg3.259 billion in September from Stg4.094 billion last year. 

-London bureau: 44 (0) 203 865 3812; email: ukeditorial@marketnews.com

[TOPICS: M$B$$$,MABDS$]